The Technicals for the U.S. Capital Markets
Written by: Richard Suttmeier
NEW YORK (TheStreet) -- U.S. Treasury yields are near record lows as the "flight to quality" continues.Comex gold has been trading back and forth around my annual pivot at $1575.8 as speculators attempt to re-inflate the gold bubble. Nymex crude oil prices are rebounding above its 200-week simple moving average at $80.36 but have stayed shy of its 50-day simple moving average at $87.49. The euro versus the dollar has been declining as the debt crisis continues in Europe. The major equity averages need to close above their five-week modified moving averages to maintain positive weekly chart profiles.
Analysis of the Yield on the 10-Year Treasury NoteThe weekly chart below shows a negative divergence in momentum as the near term decline in yield approaches the all time low of 1.439 set on June 1st. The 200-week simple moving average at 2.929 is the trend towards lower yields since 2007. A weekly close above the five-week modified moving average at 1.636 favors higher yields, but not the popping of a bond bubble. My quarterly value level is 1.869 with a monthly pivot at 1.568 and semiannual risky level at 1.389. My annual value level is 2.502.
Analysis of Comex Gold The weekly chart for gold shows rising momentum and a close Friday above the five-week modified moving average at $1597.4 shifts the weekly chart to positive from neutral. All week long my annual pivot at $1575.8 provided a stabilizing force. I am not in the camp that gold sees a new all time high above $1923.7 set in September 2011. I show semiannual risky levels at $1643.3 and $1702.5, and a quarterly risky level at $1805.8. A monthly close below $1575.8 indicates risk to my annual value level at $1388.4.
Analysis of Nymex Crude Oil The weekly chart for crude oil shows a positive divergence for momentum. A weekly close above the five-week modified moving average at $87.15 shifts the weekly chart to positive. A key to stability this week was seeing oil stay above its 200-week simple moving average at $80.36. My semiannual value level is $76.71 per barrel with monthly and annual risky levels at $100.47 and $103.58. This wide spread says look for random up and down volatility.